Bankruptcy Jumps Among Seniors

A recent CBC report found that bankruptcy and debt among older Canadians is not only on the rise but has jumped 40 per cent since 2012, according to Statistics Canada.  In the past 15 years, the number of seniors over 55 declaring bankruptcy has increased to one in five, a 400 per cent increase and a disturbing trend with no end in sight.

Why are so many older Canadians facing financial struggle later in life?  It’s a combination of living longer, failing to change spending habits in retirement, poor investment strategies, easy access to credit and a growing trend of adult children moving back in with their parents.  Many of those “boomerang” children are not contributing financially to the household and are draining their parent’s retirement savings.

With increasing longevity, younger seniors are finding themselves in the new “sandwich generation”; caught between caring for elderly parents and finding their adult children and grandchildren relying on them for help as well.

Part of the dramatic rise in the number of those over 55 experiencing financial difficulty is due to the shift in Canadian demographics.  Seniors (over 55 ) now represent more than a third of the population and with the great number of aging baby boomers, this trend will not only continue but will increase over the next 20 years.

If Canada’s seniors are going to survive and thrive in an increasing longer retirement, planning and tough love are going to paramount in managing finances into old age.  For more information about planning for retirement, visit the Financial Consumer Agency of Canada’s website at http://www.fcac-acfc.gc.ca/Eng/forConsumers/lifeEvents/planningRetirement/Pages/home-accueil.aspx .